UBS Conference 19June2007 (clickable no notes)€¦ · frontline staff with customer interactions Indicative Network Operating Model Tier 1 • Dedicated Personal Lender(s) • Dedicated

Commonwealth Bank of Australia ACN 123 123 124

UBS FIG ConferenceSydney 2007

20 June 2007

David CraigCHIEF FINANCIAL OFFICER

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The material that follows is a presentation of general background information about the Bank’s activities current at the date of the presentation, 20 June 2007. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate.

Disclaimer

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Agenda

First Half 2007 Results

Progress by Business Units

Hedging Volatility

Summary

Q&A

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OverviewPositive outlook for domestic economy

All businesses performing well

Continuing good progress on strategic initiatives

Credit quality remains sound

Highly successful $1.35bn PERLS IV

Investors receive BBSW + 1.05%

Cost to CBA BBSW – 1.17%*

Earnings momentum maintained into second half

Australian credit growthCalendar year

2007Forecast

2006Actual

Personal 9 – 11% 11.5%

Housing 12 – 14% 13.8%

Business 13 – 15% 15.5%

* Estimate net of franking credits, final to be set on issue

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Strong half year results

Dec 06Dec 06 vDec 05

Cash NPAT* 2,271 19%

Cash EPS* 174.7 17%

Return on Equity – Cash 22.3% 60bpts

Income 6,438 11%

Expenses 3,144 6%

Fully Franked Dividend 107c 14%

* Excludes profit on sale of Hong Kong in December 05

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Australian Retail

BCI ASB (NZD)

11%11%

25%

10%11%

15%

4%6%

18%*

4%

10%

5%

0%

18%18%

27%

17%15%

29%

8%

0%

5%

10%

15%

20%

25%

30%

Income Expenses NPAT

Revenue growth outstrips costs

Banking Funds Management

Insurance Group

Dec 06 vs Dec 05

* Excludes volume expenses & HK operations

0%*

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Half year NPAT split

17.5%

40.2%

33.7% 8.5%10.2%

5.1%

2.2%

Australian Retail

Business, Corporate and Institutional

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Australian Retail Customer satisfaction scores continue to improve:

Complaints down 51% since October 05 and 44% in last 12 months

May 2007 was highest ever compliment month

Front line staff trained in Cohen Brown needs analysis

Simplified and competitive product offerings

7 Cannex awards for deposits

Money Magazine Gold award for 3 & 5 year fixed home loans

Roy Morgan Research (% of MFI Customers Satisfied)

62%

72%

82%

Jun 05 Oct 05 Feb 06 Jun 06 Oct 06 Feb 07 Jun 07Apr 07

CBAANZNABWBCSGB

Branches 1,010

Customers > 8m

ATM’s 3,173

First half NPAT $912m

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Australian Retail

New network operating model

Benefits to our customers

Branch modernisation

Process & procedure to support frontline staff with customer interactions

Indicative Network Operating Model

Tier 1

• Dedicated Personal Lender(s)

• Dedicated Financial Planner

• Access to Relationship Manager

• Access to Business Banker

• Dedicated Branch Insurance Rep

Tier 2

• Dedicated Personal Lender or Customer Service Rep

• Access to Financial Planner

• Access Business Banker

Tier 3• Access to Branch Insurance Rep,

lending skilled Customer Service Rep and other specialists

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Business, Corporate & Institutional

Institutional Banking

Corporate Financial Services

AgribusinessLocal

Business Banking

Private Client

Services

Distribution

Product

Banking Products

Global Markets & Treasury

5,800 people in 6 countries300,000 + customers

$762m profit after tax for the half year$160bn assets

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Business, Corporate & Institutional Our capabilities

DebtDebt EquityEquity

DistributionDistribution

Risk ManagementRisk Management

Transaction BankingTransaction Banking

Trade FinanceTrade Finance

+

=total capital solutions

Our industry expertise

InfrastructureInfrastructure UtilitiesUtilities

Natural Resources

Natural Resources PropertyProperty

GovernmentGovernment Financial InstitutionsFinancial

Institutions

TelecomsTelecoms MediaMedia

Industrials Industrials

Global Markets & TreasuryInnovative products and structuring Investing in people & technologyIncreased client service focusSuccessful Platinum IPO, PERLS IV

Institutional BankingIndustry expertiseTotal capital solutions 30% of income from Global MarketsFurther develop debt & equity capital markets profile supported by CommSecMargins have been steadyEast & Partners customer satisfaction

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Business, Corporate & Institutional Business Banking

Refocussed segments

Reduced portfolio size (av. 50% )

Simpler, faster processes

Auto-decisioning in ≤ 1 hr

LBB products down from 55 to 7

LBB advocacy 50% in last 9 months

Private Client ServicesCommSec 1.4m customers

Volumes up 30%

Margin lending 27% growth from structured and protected products

Top Tier Corporate SME

Prior Current

50-60

20-30

90-110

40-60

200-250

Reduced Portfolio Sizes(Corporate Fin Services)

100-150

Relationship Manager Portfolios(No. of customers)

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Local Business BankingNew servicing model

Client

Branch Phone / Email Web

Personal Relationship

Manager13 19 98 LBB’s Phone #Business Banker

in Branches LBB Online

Banking AssociatesConciergeAdministrationExpertise

SpecialistsAsset FinanceMerchant

Local Business BankerValue AddRelationship Management

24 x 7

“Your business will always get an answer”

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Business Overview

4,430 people in 7 countries$235m profit after tax for the half year$168bn Funds under Administration

Funds Management

#1 in Retail Managed Funds#2 in Property$131bn FUM860 people in Australia, UK and Asia

Platforms & Advice

FirstChoice fastest growing retail platform#5 in advice (CFP and Financial Wisdom)Retail FUA $83bn2,060 people

Insurance

#1 in Life Insurance#6 in General Insurance (H&C)$1,060m in Gross Written Premium1,420 people

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Wealth ManagementGlobal Asset Management

Innovative investment solutions, total return strategies and diversification of asset classes

Recent transactions include: $1.25bn AWG$1.5bn raised in China Cinda joint venture,Dreamworks music, Generation Investment Management alliance, CRI joint venture

CommInsure

Leverage bank to grow General Insurance

Sales up 26% on last year (130 Branch Insurance Reps by 30 June 07)

Reduce operational risk and improve systems and processes

47% improvement in time taken to process claims

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Wealth Management

Colonial First State

Australia’s largest fund manager - $168bn FUA

FirstChoice success:

83% of customer rate call centre 9 or 10/10 (Roy Morgan)

Application processing down from 9 to 3 hours

Financial planner network increased 10%

Funds Under ManagementFunds Under ManagementFlagship portfoliosFlagship portfolios

2004 2005 2006-4%

0%

4%

8%

Masterkey (MLC) 12.1%Life/Custom (AMP) 8.9%FirstChoice (CBA) 8.2%Asgard (St George) 8.2%BT Wrap (WBC) 7.8%

FirstChoice

Market share

change

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ASB

Retail deposit market share up, other market shares flatLeading edge branch designSelected as default Kiwisaver provider for government-led retirement savings initiativeIncreasing management and leadership capabilityScope for branch network expansion

Were other banks chosen as default Kiwi saver provider??

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Asian growth

China11% Jinan City Commercial Bank19.9% Hangzhou City Commercial BankBeijing and Shanghai – Representative officesChina Life CMG – JV life insurance First State Cinda Fund Management Company

JapanBranch

Hong KongBranchFirst State Investments

VietnamRepresentative office

SingaporeBranchFirst State Investments

IndonesiaPT Bank CommonwealthAstra CMG – JV life insuranceFirst State InvestmentsANK acquisition (pending regulatory approvals)

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CEO Priorities & Measures

Customer Service

Business Banking

Technology & Operational Excellence

Trust & Team Spirit

Profitable Growth

Superior operating and financial resultsSuperior operating and financial results

AustraliaAustralia’’s finest financial services organisations finest financial services organisation

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Reporting Hedging VolatilityPeer Peer Peer Peer

1 2 3 4 CBA

Hedge ineffectiveness(outside 80-125%)

Non-AIFRS-complianteconomic hedge

Hedge NZ profit n/a

Pre-AIFRS hedge n/a n/a n/a

Key= Included within Cash NPAT= Excluded from Cash NPAT

CBA

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Reporting Hedging Volatility

AIFRS is here to stay

CBA provide transparent disclosure of:individual line item impacts (NII / OBI)impact on headline Net Interest Margin

Enables users of accounts to exercise their own judgment

What gets reported, gets done

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Summary

Outlook for domestic economy remains positive

All businesses performing well

Continuing good progress on strategic initiatives

Credit quality remains sound

Earnings momentum maintained into second half

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Commonwealth Bank of Australia ACN 123 123 124

UBS FIG ConferenceSydney 2007

20 June 2007

David CraigCHIEF FINANCIAL OFFICER